Posted on Fri, Feb 17, 2012
As of 2010, the average American student borrowed more than $23,000 while obtaining a four year degree. Even at a low interest rate of 5 percent, you'd have to pay $244 per month for 10 years to erase those student loans. However, the question of exactly how much is okay to borrow for college is less dependent the amount of debt you may rack up, but more about how much money you'll make once you graduate.
Research Your Career
Deciding your future career goals is one way to explore the approximate amount of money you'll make once you graduate. Visit the Bureau of Labor Statistics and peruse various 
occupations you're interested in making your career. They detail current average salary ranges for many different occupations. For example, racking up $50,000 might seem like a lot of debt, however, lawyers make a mean salary of about $129,000 per year. Conversely, racking up that same amount might prove prohibitive for a tax preparer who only has a mean salary of $37,000 per year.
Determine Future Needs
Since paying for student loans does not generally begin until after you've received your degree, many students do not take into account the future impact of having to pay those loans in correlation with other life expenses. For example, if you plan on moving to a major city after college, the cost of housing will be higher than if you live at home for a period of time. Aside from housing, take into account the cost of transportation, utilities, insurance and healthcare. The less amount of money you need to dedicate to those categories, the more you may be able to take in student loans. Create your budget here.
Take Only What You Need
The conventional wisdom regarding student loans is to borrow only what you need to complete your degree. For example, if you receive graduation gifts from family members or have a job, these monies should be used to pay for school related expenses first. Additional money should not be taken just to be stored in your bank account to use for recreational activities. Estimate your student loan payments.
All Loans Are Not Equal
Seek out federally subsidized loans such as Perkins or Stafford loans before taking loans from other sources such as high interest credit cards. State-based student loans can also over low interest rate and little or no orignation fees. Keep in mind variable rate loans don't have fixed monthly payments so the estimate you receive now won't necessarily be what you pay each month by the time you graudate.
Posted on Mon, Feb 13, 2012
On the road to a post-secondary degree, college financing is extremely important to making everything work out. What do you need to consider as you take these important steps towards your future?
The first step is to fill out the FAFSA. The FAFSA determines your family's need and, subsequently, your eligibility for federal grants, such as Pell Grants and FSEOG, and loans, including Federal Perkins Loans and Stafford Loans. The FAFSA also helps serve as a bridge to determine eligibility for other financial aid, including institutional grants and need-based scholarships.
Once you have filled out the FAFSA and your eligibility for federal grants and student loans has been determined, your family may still need to borrow more than the government can offer you. It is therefore important to know about the different types of loans available and how they will work for you.
In addition to the federal Stafford and Perkins loans, there is also a fixed rate loan called the Federal PLUS Loan, that is taken out by the parent. The student is not obligated on this loan. The PLUS loan has a 7.9% fixed interest rate and a 4% fee. However, unlike the federal Stafford and Perkins loans, it doesn't have annual borrowing limits.
Other than the PLUS loan, college loans are primarily offered by the state and by private lenders. State-based lenders tend to offer fixed-interest loans, which means that the interest rate on your loan will remain stable throughout the term of your loan. Sometimes the rates on these loans are even lower than the federal PLUS loan rates and they may have no origination fees. Check out Rhode Island's fixed rate loan.
Private lenders and banks primarily provide variable-interest loans. This means that the interest rate you pay after college, along with your individual payments, could change from month to month. Although variable-interest loans are currently at all-time lows, the four years it will take to graduate from college—and the time it will take after that to pay off your loans—can be a long time in the financial world, and it is important to consider what your financial situation will be like after you graduate. While prime rate may be a 3.25% now, in the 80s, it was over 20%! Check out the history of the prime rate and determine if you are willing to take the financial risk over a 10-15 repayment period.
As you consider and select your college, your college may offer you a resource list that provides you with places you may apply to for a loan. Such lists can be invaluable for many students; remember, however, that you are by no means required to limit yourself to this list if you find better offers elsewhere.
Overall, the best thing you can do for your college financing is to be informed. Further descriptions of student loans can be found at http://www.cpcri.org/PayforCollege/FinancialAid101/TypesofAid/Loans/tabid/131/Default.aspx. You may also want to refer to RISLA's guide to student borrowing at http://blog.risla.com/borrowing-guide-for-student-loans.
Posted on Fri, Feb 10, 2012
Are you looking for free money for college? College scholarships and grants abound, but how do you establish yourself as a recipient? The simple answer to this is: Those who do not apply will not receive. Money will not come to you unless you tell it you are there and waiting.
What do I need to do?
The first step for most college aid is to apply for the FAFSA. The FAFSA allows you to establish eligibility for – and to be considered for – federal grants and awards such as the Pell and FSEOG. These do not need to be repaid and are awarded based on your family's need.
In addition to establishing eligibility for federal grants, many institutions use the FAFSA to judge eligibility for institution-specific grants. These grants can extend well beyond the grants the government will provide. This is especially true at more expensive private institutions, which may cost more on the surface, but also have larger endowments and understand the value of attracting motivated students. Usually, once you are accepted at such colleges, these colleges will tell you what kind of financial package they can offer you, including scholarships and grants.
If you need help completing your FAFSA, free appointments can be made at www.collegeplanningcenter.org.
Merit-Based Scholarships
So what to do once you have applied for the FAFSA and other need-based awards through the government and individual institutions?
Other than need-based awards, most awards are merit-based – but merit-based does not always mean you need to have a 4.0. Many scholarships have GPA requirements as low as 2.0, or do not judge based on GPA at all. In these cases, you only need to demonstrate sufficient skill or involvement in other areas such as community service or involvement.
Scholarships can also focus on different geographic regions. Nation-wide scholarships tend to be more competitive, while local scholarships are usually easier to obtain. Rhode Island Scholarships' scholarship database can help Rhode Island students find local scholarships that may be difficult to locate otherwise. Other more general scholarship engines also exist that can help locate other scholarships.
Once you have received all possible scholarship and grant awards, the next option are loans, which need to be repaid, or paying out of pocket. So while you have time, give yourself the resources to apply, apply, and apply for that free money for college that's waiting for you.
Posted on Tue, Feb 07, 2012
Applying for the Rhode Island State Grant is easy. All you need to do is make sure you file your Free Application for Federal Student Aid (FAFSA) by March 1and you will automatically be considered for this opportunity. While award amounts have yet to be determined for the 2012/13 academic year, in past years they have ranged from $250 to $700.
The Rhode Island State Grate is meant to help Rhode Island students and families whose resources are not enough to meet the growing costs of higher education.
Eligibility
- You must be a Rhode Island resident and a citizen of the United States or an eligible non-citizen.
- Your school must certify enrollment if you were offered a R
I State Grant before the funds are disbursed
- Students must have a RIHEAA (the agency that administers the grant) calculated financial need of at least $1000 to be eligible for a RI state award. Award amounts range from a minimum of $250 to a maximum of $700. Amounts increase in $50.00 increments.
- Student must be enrolled at least half-time.
You can call Rhode Island's Scholarship & Grant Division at (401) 736-1170 with any questions or visit www.riheaa.org.
For free assistance completing your FAFSA, book an appointment with the College Planning Center of Rhode Island.
Posted on Thu, Feb 02, 2012
JANUARY 29, 2012
Cash-Strapped States Cut College Financial Aid
Edited By CRISTINA LOUROSA-RICARDO
College financial-aid season has just kicked off, and experts say students seeking state grants
had better act fast.
At least six states, including Illinois, Kentucky and Tennessee, now have "until funds depleted"
policies on grants, meaning late filers risk getting nothing. Other states are shrinking the
application window. Oklahoma, for example, moved its grant-application deadline to March 1
this year, two weeks earlier than last year. Oregon's Feb. 1 deadline is the earliest of any state for the second year in a row.
"It's essentially a technique for reducing the number of students who qualify because not
everyone will [apply] on time," says Mark Kantrowitz, publisher of FinAid.org and FastWeb.com.
Thanks to growing budget deficits and rising demand for financial aid, states say they're running out of grant money earlier and earlier each year. Many cash-strapped states have cut student aid, while colleges have been raising tuition.
For some, acting quickly still won't be enough. Last year, New Hampshire announced it was
ending its grant support to college students because of state budget woes—making 2012-2013 the first year that residents can't apply for state aid. The cut also impacts Maine residents, who previously could use their state's grant when attending a New Hampshire college; Maine ended that practice after New Hampshire terminated its grant program. (Maine still offers its state grant for students attending college in its state and in five other states on the East Coast, including Connecticut, Massachusetts and Pennsylvania, as well as Washington, D.C.)
To increase their chance of receiving aid this year, parents should file the Free Application for
Federal Student Aid, or Fafsa, as soon as possible, says Rod Bugarin, a financial-aid consultant and former financial-aid officer at Brown and Columbia universities. Even parents in states with spring deadlines might want to consider filing soon since more states may run out of aid early, he says. Filing early also helps maximize the free aid students will get directly from colleges, advisers say.
Submitting the required paperwork in the next few weeks may be a challenge, especially for
families who have not yet filed their taxes. Rather than waiting, parents should consider filing
the Fafsa with estimates based on 2011 paystubs, bank account and brokerage statements,
and their 2010 tax return, says Mr. Kantrowitz.
You can make updates to the application later on. But parents should keep in mind that
revisions could impact the grant money students receive when school begins.
—AnnaMaria Andriotis, SmartMoney.com
Posted on Tue, Jan 24, 2012
Student Loans Aren’t Going Away, but They Could Be Improved
January 19, 2012, 3:22 pm
By Beckie Supiano
This past fall, Occupy Wall Street protesters announced a “student-debt refusal” campaign, in which participants would stop paying their loans once a million people had signed up to do so. Meanwhile, a petition, which calls on the government to forgive Americans’ student-loan debt, has some 660,000 signatures.
Neither of those approaches is particularly practical, according to Mark Kantrowitz, the student-aid expert behind the Web sites FinAid and Fastweb. In a column for the National Association of Student Financial Aid Administrators’s Web site, Mr. Kantrowitz writes that refusing to repay loans will hurt borrowers more than the government or other lenders, and that mass loan forgiveness is not the best way to stimulate the economy.
Still, Mr. Kantrowitz writes, the protesters and petition signatories have a point:
“Many of the protesters claim high levels of education debt and difficulty getting jobs,” he writes. “Unemployment rates won’t drop to pre-credit crisis norms for at least four more years, assuming the current economic downturn follows the pattern of previous recessions.
But even after the economy recovers, the debt will continue. There are also ever-increasing numbers of students graduating with excessive debt each year, due to a failure of grants to keep pace with increases in college costs, inadequate counseling, and some students blindly following their dreams without contemplating the consequences of too much debt.”
There is no easy fix to this problem, but Mr. Kantrowitz suggests several things Congress and colleges could do to help. For example, he says the government should let student loans be discharged in bankruptcy and make the improved income-based repayment plan available to all borrowers, while colleges should require students to go through financial-literacy training.
Posted on Mon, Jan 09, 2012
Check out this great article from CBS Money Watch on tips for getting the most federal student aid.
CBS Money Watch
January 5, 2012 8:07 AM
10 tips for getting federal student aid
By Lynn O'Shaughnessy
It's financial aid season, which means millions of families will be grappling with the
FAFSA in the next few weeks.
Chances are most families are going to make mistakes when completing the Free
Application for Federal Student Aid. These mistakes can be costly, and may even keep
you from receiving the financial assistance for which you qualify.
Here are 10 tips to help you successfully complete the FAFSA:
- Don't provide retirement assets -Families can dramatically hurt their chances for financial aid if they include assets from their 401(k) plans, Individual Retirement Accounts, 403(b) and other qualified retirement accounts on the FAFSA. The financial aid form only requires that you share nonretirement assets.
- Don't include business assets - Parents who have a family-owned and controlled small business do not have to report the company's net worth on the FAFSA if it has fewer than 100 full-time employees.
- Skipping deadlines - Colleges impose deadlines on families to submit their financial aid forms, and these dates can be much earlier for students applying through early decision and early action options. Find out what the deadlines are, and don't miss them.
- File early - Although there are essentially no federal deadlines for seeking financial aid, states do impose deadlines for families who hope to qualify for financial aid through their state programs. State deadlines can be as early as February. In some states, aid is given out on a first-come, first-served basis, so it's best to file your FAFSA well ahead of the state deadline.
- Seek help
Confused? FAFSA staffers can help. You can contact the Federal Student Aid Information Center via online chat, phone or email. Here's where to find the financial aid contact information.
- List the most current marital status - You need to provide your marital status - divorced, separated or married -- on the day that the FAFSA is filed. Separated and divorced parents will sometimes enjoy a financial aid advantage.
- Have the right parent complete the FAFSA - In families of divorce, the parent who has taken care of the child during the majority of the 12 months dating from the day the FAFSA is submitted is considered the custodial parent. This can be especially advantageous in families when one ex-spouse earns significantly less than the other. Ideally, the child would live with the lower-earning parent for at least six months and a day. This parent would complete the FAFSA, and the other parent's income would not be included. If the custodial parent remarries, however, the income from the new spouse would also be included on the FAFSA.
- Avoid blank answers - If the answer to a question is zero or not applicable, write "0" or "Not Applicable" on the online form. Leaving blank answers can cause miscalculations.
- Pay attention to graduation rates - When you complete the FAFSA and designate that the application be sent to specific schools, the FAFSA website will provide you with the graduation rates of each school on your list. Try to avoid schools with low graduation rates.
- Don't inflate your education
Plenty of schools will give applicants brownie points if they are considered firstgeneration college students. If parents didn't graduate from college, select "high school" as the highest education attainment.
Bottom Line: Following these tips can help you increase your financial aid award, and
every dollar counts.
Live in Rhode Island? Get free help completing your FAFSA at the College Planning Center of Rhode Island.
Posted on Fri, Jan 06, 2012
The Free Application for Federal Student Aid, more commonly referred to as the FAFSA, is the gateway to all federal financial aid and much institutional college financial aid. But many families find this form to be a bear to fill out. 
The good news is that free help is available nationwide through the national College Goal Sunday program. This program hosts free events during the month of January in which you can go and get assistance from financial aid experts with filling out your FAFSA. Find a location near you.
The details for College Goal Rhode Island (this year held on a Saturday rather than Sunday) are listed below. You can register at one of the 7 locations here.
College Goal Rhode Island
Saturday, January 28, 2012
For more details and to register for College Goal Rhode Island visit www.collegegoalri.org.
For free one-on-one assistance in Rhode Island, book an appointment with the College Planning Center of Rhode Island. All services are free and provided by Rhode Island Student Loan Authority.
Posted on Wed, Jan 04, 2012
Follow this simple step-by-step process to make sure you qualify for as much financial aid as possible.
Step 1: Apply for a PIN.
Apply for a PIN at www.pin.ed.gov. Your PIN will enable you to “sign” documents electronically, access your Student Aid Report (SAR) online and make corrections to your FAFSA through the web. Both the parent and student must each apply for a PIN. If you have applied for aid in past years, you can reuse your pin.
Step 2: Submit the FAFSA.
You should file the Free Application for Federal Student Aid (FAFSA) as soon after January 1 as possible. The FAFSA is used by all colleges to determine your Expected Family Contribution (EFC) and your eligibility for federal and state aid, including subsidized student loans. Most colleges also use the FAFSA to determine your eligibility for institutional aid.
The FAFSA cannot be filed until after January 1st, but it must be completed and received prior to the college’s priority deadline date. The FAFSA must be filed for every year the student is in school. Submit your FAFSA online at fafsa.ed.gov. A FAFSA requires a signature from both a parent and the student applicant. To sign the online application, you must use your PIN (see Step 1).
Families are encouraged to file the FAFSA early even if they do not have all the necessary tax information required for the form. If necessary, this information can be estimated. You will have the opportunity to change or update information later in the financial aid process.
There is no fee involved in filing the FAFSA and all families are encouraged to apply regardless of their family circumstances. While the FAFSA form may seem long and complicated to fill out, free help is available through the College Planning Center of RI.
Step 3: Submit the CSS/PROFILE and other financial aid forms, if applicable.
Some private independent colleges require you to file a CSS/PROFILE application or an institutional financial aid form to determine your eligibility for their own sources of financial aid. The PROFILE application can be completed as early as October and is only available online here. Make sure you understand if you need to file any additional forms and that you submit them by the school’s specified deadline.
Step 4: Apply for scholarships.
Millions of dollars in scholarships are available each year. Start your search online at www.rischolarships.org for local Rhode Island scholarships. Use tools like www.fastweb.com to search for national scholarships. Don't forget to check your guidance office and local library for more opportunities. Scholarships are a great way to help pay college tuition, books and living expenses and can reduce the amount you need to borrow. You should always maximize the amount of free money you use to pay for college before borrowing.
Keep in mind national scholarships are much more competitive and often times much harder to attain than local scholarships. Even though the awarded amounts on national scholarships may be higher, you most likely have a better chance of getting a scholarship from a local business or organization.
View a comprehensive list of scholarships and scholarship search tools here.
Step 5: Review your Student Aid Report (SAR).
Approximately one month after filing the FAFSA, you will receive a Student Aid Report (SAR). Correct any mistakes on this form, update any changes in financial circumstances or add additional colleges where you would like your information to be sent.
The EFC information from on your SAR will be sent to the financial aid office at the colleges that you indicated on your FAFSA form. Each college then takes that amount and subtracts the EFC from their total cost of attendance. That figure is your family's demonstrated financial need for that particular college. Financial need will be different for each college you apply to because each college's total cost of education is different.
Step 6: Review your award letters.
Each college's financial aid office then determines what aid it has available to help meet your demonstrated financial need. Schools will aim to meet as much of your need as possible but not all schools can afford to meet 100% of your financial need. The financial aid office will put together a financial aid package or award letter for you. The aid may come in the form of grants, work study, scholarships, student loans and so on.
Remember, when your financial aid package arrives in the mail, read it over carefully. Decide if you want to accept any of or the entire award. Pay attention to instructions the school gives you. You may have to complete additional paperwork to fully accept the award. Accepting your award by the school’s specified deadline will safeguard it. However, if you feel that the award does not fully meet your financial needs or your needs have changed due to illness, unemployment or for some other reason, you can try appealing the award. Make sure to have documentation that supports your request. Many schools will take a second look at your package, if asked.
If you receive multiple financial aid packages, take note of which expenses are included in each school’s total cost of attendance when you compare. Also, pay attention to what kind of aid each school is offering your family. One school might meet a higher percentage of your need, but may do so with a greater proportion of loans. Sometimes, a school with a higher cost of attendance could end up costing your family less in the long run.
Your financial aid package may or may not cover your total financial need. If financial need is not entirely met, this unmet need is called a "gap." This means that resources must be found in order to meet the full cost of education. In many cases this will mean additional student and parent loans. Use our meeting college costs calculator to figure out how you will meet the difference.
Step 7: Apply for loans, if necessary.
Your school may include federal student loans on your award letter. If these loans are not listed on your award letter, you still may be eligible to borrow. To accept your federal loan awards, you will need to complete a Master Promissory Note.
If you decide to take out a private student or a state-based student loan, you will need to select a lender. Our guide can help you understand what questions you should ask your lender before borrowing.
Posted on Thu, Dec 15, 2011
When it comes time to begin the tedious process of filling out college applications, it is imperative that they are done correctly, efficiently, and effectively.
Our former admissions counselors have seen many applications land in the trash due to simple mistakes. Consider the competition involved when it comes to college acceptance due to the struggling economy. Since just about every state in the union has had to make cuts in order to balance budgets, and colleges receive the bulk of their money from state funding, it has, in some cases, led to a reduction in the amount of students who can be accepted. 
With less seats available for students to fill, and more students than ever applying, a simple misspelling on your college application could be the difference between hearing "We are happy to announce...", and "We are sorry to inform...".
It may not seem fair to judge someone's entire academic career holistically just by glancing at their college application, but try to think from an admissions counselor's perspective. You're sitting at a desk in a cramped cubicle, and a stack of fifty applications are placed in front of you. All fifty of the college applications before you have been pre-approved, meaning they meet the minimum requirements necessary for acceptance. The dilemma? There are only thirty slots available, so you are forced to reject twenty qualified college applications. Your job is a simple two-step process; first you eliminate any college applications containing errors, and then you stack the remaining college applications from best to worst based on SAT scores, accomplishments in and out of school, and GPA's. The top thirty are accepted, the bottom twenty are eliminated.
Wouldn't it be a shame if the college application of a brilliant, deserving student didn't make it in the final cut because certain credentials and civic accomplishments were not properly noted? Wouldn't it be even worse if it never made it past step one due to a spelling or grammatical error?
Below is a list of common mistakes you must avoid when filling out a college application:
- Misspellings: Ask an english teacher or highly educated friend or family member to edit your college application prior to submission. This is the single biggest reason why college applications end up in the no pile.
- Grammatical errors: Once again, have someone revise your college application for you. The more revisions, the better.
- Lack of professional wording: Referring to the school as "your school" isn't professional. It is good to have a personal attachment to the school, but keep it professional.
- Lack of leadership examples: Mention every club, any volunteering you've done, every church play you've participated in, fundraising events, etc.
- Bad Handwriting: There is a reason why many college applications must be handwritten, and you will be rejected if it isn't legible or clearly and professionally written.
Be sure to use this list as a guide while filling out your applications. Keep it handy throughout the process so that your college application can make it to step three "We are happy to announce...".
View general college application requirements.
Need assistance reviewing your college applications? Make an appointment with an experiences college planning counselor.